NEW YORK, Oct. 13, 2012 /PRNewswire/ -- Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential securities fraud at Assisted Living Concepts, Inc. ("ALC" or the "Company") (NYSE: ALC).
The investigation focuses on whether the Company and its executives violated federal securities laws by failing to disclose that: (1) ALC was in breach of the Ventas Lease's minimum occupancy covenants, which were hidden by treating units leased to employees as third party rentals; and (2) Georgia and Alabama state regulators had served notices in February and March 2012 of their intent to revoke licenses for three of the ALC facilities leased from Ventas.
In early May 2012, the audit committee of ALC's board of directors launched an investigation after receiving an internal whistleblower complaint concerning "possible irregularities in connection with" the lease, and on June 21, 2012, ALC settled with the landlord, causing ALC to incur a net loss of $19.5 million for the first six months of 2012 – an amount close to ALC's entire net income in 2011. On August 7, 2012, ALC announced that it was the subject of an SEC investigation concerning a number of topics, including "compliance with occupancy covenants" under the lease and the "leasing of units for employee use."
Upon this news, ALC shares fell over 26 percent to close at $7.89 per share on August 7, 2012, representing a loss of shareholder value of over $51 million.
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If you purchased ALC stock or options between March 12, 2011 and August 6, 2012 and would like to discuss your legal rights, visit www.faruqilaw.com/ALC. You can also contact us by calling Richard Gonnello or Francis McConville toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to firstname.lastname@example.org, email@example.com or firstname.lastname@example.org. Faruqi & Faruqi, LLP also encourages anyone with information regarding ALC's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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FARUQI & FARUQI, LLP
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New York, NY 10017
Attn: Richard Gonnello, Esq.
Francis McConville, Esq.
Telephone: (877) 247-4292 or (212) 983-9330
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